Housing demand outpaces open lots

Extensive growth in Hillsborough and Pasco counties puts the area closer to buildout.

By JAMES THORNER
Published May 4, 2004

You wouldn't know it from the bulldozers, concrete mixers and clouds of construction dust, but the Tampa Bay area, in the midst of one of its healthiest housing booms, is running out of lots.

Metrostudy, a national real estate research firm, said the region has only a 91/2-month supply of lots on which to pour slabs or raise roofs. Lest that sound plentiful, the normal state of affairs is an 18- to 20-month supply.

"For the first time in 20 years, we've had less than a 10-month supply of lots. The demand for housing has outpaced the ability to deliver the lots," said Tony Polito, director of Metrostudy's Tampa office.

The area has only its economic success to blame. Historically low interest rates have boosted home sales, persuading renters to become buyers.

On top of that, the Tampa Bay region added 13,900 new jobs during a 12-month period ending March. Local unemployment, at 3.8 percent, is well below the national rate of 5.7 percent.

The beneficiaries have been Tampa bedroom communities.

Six of the 10 fastest-growing housing developments in the region follow Pasco County's State Road 54 corridor. The remaining sellers in the top 10 stretch across the SouthShore area of southern Hillsborough County.

"Brandon has only a six-month supply of lots. So housing is going south of the Alafia River," Polito said. "It's just availability of land."

Summerfield Crossing, the several-thousand-home golf course community in Riverview, was the housing leader the past year with 592 housing starts.

Southwest Pasco's Trinity neighborhood came in second with 525, followed by FishHawk Ranch south of Brandon with 478, Sun City Center in Hillsborough with 462 and Pasco's Meadow Pointe with 407.

Overall construction has been equally torrid. From April 1, 2003, to March 31, annual housing starts jumped to 17,421 single-family homes, a 26 percent increase from the previous year.

Metrostudy defines a housing start as the pouring of a concrete foundation.

Job growth has energized much of the spurt. So have the continuing influx of retirees and the thousands of renters coaxed by low interest rates into buying starter homes.

What most of the housing leaders have in common is proximity to jobs in Tampa and St. Petersburg. Affordability also is key.

Homes in Pasco's Wesley Chapel area sell for about $15,000 less than a comparable home over the county line in New Tampa. Riverview houses run about $30,000 less than those in Brandon.

"Obviously it's location, marketing and amenity packages," Polito said. "The only thing that's universal now is that the top 10 are all on State Road 54 or south of the Alafia."

Illustrating the looming shortage of lots, buyers have picked clean entire tracts, sometimes before builders can showcase their communities with model homes.

That's what happened at Ashley Lakes, a subdivision targeting first-time home buyers at Gunn Highway and State Road 54 in Pasco.

By March, Centex Homes had sold a third of its 313 lots there. The first model wasn't ready for tours until April. The demand inspired Centex to raise prices 15 to 20 percent in one year. Pasco's average new home price has reached $187,000.

There appears to be little to blunt the housing spike. Despite expectations that interest rates will climb in late summer or fall, they would have to climb high before home sales start slumping in an otherwise healthy economy.

"Historically, we have to get at or above 8 percent for interest rates to have any effect on us," Polito said.